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Rezolve published new sales guidance for 2025 and 2026 this morning.
The company's targets came in ahead of the average analyst estimates, but the sales guidance wasn't good enough for investors.
Rezolve AI (NASDAQ: RZLV) sock got hit with big sell-offs in Tuesday's trading. The company's share price closed out the daily session down 9.2% amid the backdrop of a 0.2 decline for the S&P 500 and a 0.1% decline for the Nasdaq Composite.
Rezolve published new full-year guidance for 2025 and 2026 before the market opened this morning, and investors responded by selling out of the stock. The company's share price is now down roughly 53% from its one-year high.
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With the update that it published this morning, Rezolve said that it anticipated at least $40 million in revenue for 2025. The company's press release noted that its target came in above the analyst consensus.
The company also said that it was targeting roughly $350 million in sales for 2026 -- topping the average analyst estimate's call for sales of $170 million in the period. Management expects to close out this year with the business generating at least $500 million in annual recurring revenue (ARR). Rezolve announced that it reached $209 million in ARR in December and recorded its first profitable month of operations.
Rezolve's downward stock move following what looks to be strong guidance highlights investor uncertainty surrounding the company and its scaling. While management reiterated its previous target for hitting $500 million in ARR this year, some investors were apparently hoping for a more detailed breakdown of the business outlook.
The company's valuation was actually gaining ground in pre-market trading today, but the big pullback that occurred after the market opened suggests that the stock continues to be a "show me" story for many investors. Even on the heels of today's valuation slide, the company has a market cap of approximately $1.2 billion and is valued at approximately 3.4 times management's sales target for this year. Shares could have substantial upside potential if the business can deliver margin improvements and hit that $350 million sales target, but the artificial intelligence (AI) software specialist still has a lot of proving to do.
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